Positive Ways The Coronavirus Has Created: A New Ecosystem For The Insurance Sector
The plague that is coronavirus continues to threaten our way of life and our very existence.
And while we wait for our best scientists and big pharma to develop and deliver the vaccine we so desperately need to begin the return to some semblance of our prior lives, it is notable that finance and insurance — the nation’s third-largest industry — is coping better than most would have ever imagined, thanks to the technologies that have been gradually but surely emerging for at least the past two decades.
Now, with few, if any acceptable choices, these technologies, and the benefits they offer participants in the insurance ecosystem are being more eagerly embraced and adopted by insurers in the battle they are waging for their survival. Artificial intelligence, in all its manifestations, drives many solutions. It helps us transform the digital rivers of data flowing between us and our many connected devices and facilitates effective real-time decision making.
WFH (work from home) is a perfect example and, defined more broadly, encompasses video conferencing, distance learning, educational and training sessions, and internal business communications platforms. Platforms such as Zoom and Slack are well-known solutions, but dozens of similar services have proliferated. Artificial intelligence powers all of them and allows for the total individualization of communication preferences. Insurers have been able to leverage them in operations, and in a matter of just weeks have redeployed thousands of inside employees from corporate buildings to their own homes, hardly missing a beat. In many cases, customer experience has improved as distributed workflow algorithms ensure better matching of customer profiles with staff expertise and skillsets, while also reducing the associated potential risk of litigation.
The claims process has become another major beneficiary of artificial intelligence and other new technologies, including computer vision, machine learning, digital customer self-service, and electronic claim payments. Contactless (or touchless) claims is now a reality, with some large insurers reporting up to 50% use of this method across all claims.
In a world where claims are submitted and paid without physical inspection and validation, fraudulent claims detection becomes an even higher priority, and here again, solutions incorporating artificial intelligence, predictive analytics, and computer vision are being deployed effectively.
As analytics plays a critical role in streamlining claims settlement, it is now recognized as a primary driver of customer loyalty and retention. This includes the current rapid adoption of digital claims payments, which speeds up the process while removing significant processing costs for carriers and getting the money owed more quickly to customers; for many, cash flow has become more important than ever. The speedy settlement of claims has previously meant higher costs and risk of overpayment, especially in high-volume catastrophes but by employing AI technologies these risks are now being mitigated.
Here is a list of the many additional ways in which AI and related technologies will play an increasingly critical role;
- solid working knowledge of AI and technology will become a prerequisite for even entry-level employees and most certainly for organizational advancement
- the nature of risk has changed, and AI allows carriers to respond in real-time (e.g., several large insurers ceased issuing new policies on those over 75 almost immediately after COVID-19 altered mortality rate tables
- data allows management to navigate change, and AI is an important tool in generating operational road maps
- remote workforces present new management challenges in maintaining morale, motivation, and corporate culture; AI enables automated monitoring and appropriate development and testing at the individual level
- in a world of limited resources, partnerships will become more critical, and, for those that incorporate AI, relevant corporate expertise will be mandatory
- continuous learning and technology development will help meet carriers’ long-term needs and goals
As a final note, as much as we all wish coronavirus had never happened, it has supercharged innovation in the insurance industry. Some changes are welcome, many of which are likely to be permanent, and which will benefit all stakeholders in this critically important industry.
Inmediate is an insurtech startup from Singapore that is using the latest technology such as Artificial intelligence, Distributed Ledger, and NLP, making insurance processing fast, cheap, and flexible. That gives for better processes, lower costs, improved time to market, and new revenue opportunities.